Minister vows to smash Auckland city limits

New Housing Minister Nick Smith is vowing to break the “stranglehold” of Auckland Council’s policy of containing urban sprawl – a policy he says is “killing the dreams of Aucklanders” by driving up house prices.

In his first major interview on how he plans to tackle the housing affordability issue handed to him in January’s Cabinet reshuffle, he said his focus would be on opening up land supply because land prices were the biggest factor putting home ownership out of reach of many Aucklanders.

“There’s no question in my mind that we have to break through the stranglehold that the existing legal metropolitan urban limit has on land supply,” he said.

But Auckland Mayor Len Brown hit back last night, saying Dr Smith was advocating a flawed Los Angeles model of “suburban sprawl and unbridled land availability”.

“I’m pretty disappointed in the minister’s positioning, and I am disappointed because it reflects a philosophy or view of city development, and particularly development of our city, that goes back to the forties and fifties,” he said.

Dr Smith said he made a priority of meeting Mr Brown soon after he took on housing, and that the two men asked their officials to assess jointly how many of the sections for 15,000 residences which the mayor has said are available now are actually fully consented, ready and economically viable to build on.

But he said that regardless of whether the true figure was 15,000 or 5000, as the Property Council told him yesterday, it was “not nearly enough if we are going to be able to get affordable housing”.

“When we are looking at growth in Auckland of 2 per cent a year, we are going to need sections at the rate of 12,000 a year,” he said. “The metropolitan urban limit is a stranglehold on land that is killing the dreams of Aucklanders wanting to own their home and we have to work with the council to find the tools to increase that land supply and bring section prices back.”

He said the council’s plan to contain 60 to 70 per cent of new housing within the current built-up area would fail due to “community angst over intensification” and economic reality that squeezing two houses on to one existing quarter-acre section could knock $200,000 off the value of the existing house.

He said changes to the Resource Management Act signalled in a discussion paper last week could be a game-changer by requiring councils to provide adequate land supply for 10 years of growth in demand.

But Mr Brown said Aucklanders had already agreed on the city’s “compact footprint” through developing the first Auckland Plan, and Dr Smith should stop debating it.

He said the plan was based on “a model that is developing truly internationally competitive cities with strong economic bases to them and that give rise to outstanding transport operations within a more compact framework”.

“Have a look at Melbourne,” he said. “Have a look at Hong Kong. Have a look at London. All of those cities, by and large, are operating off what is regarded as best practice.”

He said there were other ways to make houses more affordable, such as “home start” loans for first home buyers that used to exist in New Zealand and still existed in Australia.